Rise of self-employed could result in retirement problems

Increasing self-employment could lead to long-term retirement problems in the future, the Federation of Small Business (FSB) has warned.

Less than a third (31%) of the 1,600 self-employed workers surveyed reported that they were saving into a private pension, while 27% are planning to rely on their business to fund their retirement.

15% suggested that do not currently have retirement savings of any kind.

FSB also found:

‘security of income’ was the biggest challenge for the self-employed with 18% reporting that they don’t know how much income they will have from ‘month to month’

income levels were diverse with 32% claimed to earn more than £2000 per month. 41% claimed to earn under £1000 while 19% said they earned less than £500 a month.

Self-employment in the country is at its highest record, up from 12% of the workforce in 2000 and 8% in 1980.

Mike Cherry, National Chairman at the Federation of Small Businesses (FSB), said:

“It has never been easier to go it alone and self-employment now stands at the highest level since records began. This should be celebrated as it brings freedom and flexibility to millions of people.

“Yet policymakers have been slow to respond to the boom in self-employment and are therefore playing catch up. If we do not act now to adapt to this changing workforce, we will only be shoring up problems for the future.”